Odd Lot
The Odd Lot term refers to a stock transaction (buying or selling stock) in which the number of shares was non standard.
Offer
The Offer term refers to the price at which an owner of an asset is ready to sell the asset. For example you can offer shares in ABC company at $300 per share.
Open Order
An Open Order is an order to buy securities, which has been submitted but has not been executed yet. An order remains open until is cancelled, executed or expires.
Options and Leaps
The trading of options employs several phrases all unique to the options' market. Some phrases that are often used but generally misunderstood include call and put options.
A Call represents an option’s contract that entitles the buyer with rights to exercise the option and acquire the underlying commodity at the strike price at any time up to the date it expires.
An options trader can be a long Call or a short Call. In the first case, the trader has bought the call contract and has the right to exercise it. In the second case, the trader has sold the call contract, which means that he may be also required to sell the underlying commodity in order to complete the contract obligations.
A Put is a contract which entitles the buyer with the rights of selling the underlying commodity at any time up to the date it expires or at the strike price.
Option contracts that are publicly traded for a period longer than a year are called LEAPS. Their structure does not differ from the short term options. However, the expiration date gives the investors the opportunity to gain exposure to price changes over a longer period of time. In this way, they will not need to combine short term options. The increased expiration date of LEAPS, compared to the standard options, makes them premium because of the expiration date that is increased over time. This gives the asset additional time to make a move, and the investor has a possibility to make a profit.
Through the Long Term Equity Anticipation Securities? the trader’s exposure to a given security is prolonged, without the need of using more than one short term contracts together. The possibility to buy a put or a call option that will expire in one or two years, lures the holder due to the long-term price movement exposure.
Overbought
When we apply "overbought" as a market indicator, it is supposed to offer us indications for the current market stage and whether it is a sound idea to buy or sell. What exactly does the term "overbought" mean and how can it be applied to achieve sound trading?
In general, the term "overbought" is used to describe a situation where the value of the stocks has increased excessively and have become too expensive.
"Overbought" is often defined as the point at which prices have moved up too far and too quickly. If the market is considered overbought, experts will start to sell.
When market prices increase in a short period of time, skyrocketing too far, the market tends to become “overbought”. This market stage indicates that a large number of high-priced shares are being transferred from one group of market participants to another. Using a lot of buying power on these transfers, the number of buyers who are willing to keep buying at such high prices becomes exhausted. They are not willing to pay anymore- the market has reached a critical point and the trend is for a reversal.
In brief, the market is viewed as overbought when a particular indicator has reached a certain level.
Oversold
When we apply "oversold" as a market indicator, it is supposed to give us indications for the current market stage and whether one should buy or sell at this point of time. The word "oversold" is usually applied with regard to trading practices.
In general, the term "oversold" is used to describe a situation in which the stocks have fluctuated downwards too much.
"Oversold" is defined as the point at which prices have moved down in a quick manner. If the market is considered to be oversold, the financial experts will start buying.
When market indicators show a drop in the price level over a brief time period, moving down excessively and quickly, the market becomes "oversold". This stage of the market indicates the transfer of an extensive number of low price shares from one category of participants to another. This activity requires considerable selling power, which exhausts the actual number of sellers who may agree to keep giving away their shares at the low prices, offered to them. Individuals no longer agree to sell shares and this indicates a critical point for the market: now the expected trend is for an upwards reversal.
The Odd Lot term refers to a stock transaction (buying or selling stock) in which the number of shares was non standard.
Offer
The Offer term refers to the price at which an owner of an asset is ready to sell the asset. For example you can offer shares in ABC company at $300 per share.
Open Order
An Open Order is an order to buy securities, which has been submitted but has not been executed yet. An order remains open until is cancelled, executed or expires.
Options and Leaps
The trading of options employs several phrases all unique to the options' market. Some phrases that are often used but generally misunderstood include call and put options.
A Call represents an option’s contract that entitles the buyer with rights to exercise the option and acquire the underlying commodity at the strike price at any time up to the date it expires.
An options trader can be a long Call or a short Call. In the first case, the trader has bought the call contract and has the right to exercise it. In the second case, the trader has sold the call contract, which means that he may be also required to sell the underlying commodity in order to complete the contract obligations.
A Put is a contract which entitles the buyer with the rights of selling the underlying commodity at any time up to the date it expires or at the strike price.
Option contracts that are publicly traded for a period longer than a year are called LEAPS. Their structure does not differ from the short term options. However, the expiration date gives the investors the opportunity to gain exposure to price changes over a longer period of time. In this way, they will not need to combine short term options. The increased expiration date of LEAPS, compared to the standard options, makes them premium because of the expiration date that is increased over time. This gives the asset additional time to make a move, and the investor has a possibility to make a profit.
Through the Long Term Equity Anticipation Securities? the trader’s exposure to a given security is prolonged, without the need of using more than one short term contracts together. The possibility to buy a put or a call option that will expire in one or two years, lures the holder due to the long-term price movement exposure.
Overbought
When we apply "overbought" as a market indicator, it is supposed to offer us indications for the current market stage and whether it is a sound idea to buy or sell. What exactly does the term "overbought" mean and how can it be applied to achieve sound trading?
In general, the term "overbought" is used to describe a situation where the value of the stocks has increased excessively and have become too expensive.
"Overbought" is often defined as the point at which prices have moved up too far and too quickly. If the market is considered overbought, experts will start to sell.
When market prices increase in a short period of time, skyrocketing too far, the market tends to become “overbought”. This market stage indicates that a large number of high-priced shares are being transferred from one group of market participants to another. Using a lot of buying power on these transfers, the number of buyers who are willing to keep buying at such high prices becomes exhausted. They are not willing to pay anymore- the market has reached a critical point and the trend is for a reversal.
In brief, the market is viewed as overbought when a particular indicator has reached a certain level.
Oversold
When we apply "oversold" as a market indicator, it is supposed to give us indications for the current market stage and whether one should buy or sell at this point of time. The word "oversold" is usually applied with regard to trading practices.
In general, the term "oversold" is used to describe a situation in which the stocks have fluctuated downwards too much.
"Oversold" is defined as the point at which prices have moved down in a quick manner. If the market is considered to be oversold, the financial experts will start buying.
When market indicators show a drop in the price level over a brief time period, moving down excessively and quickly, the market becomes "oversold". This stage of the market indicates the transfer of an extensive number of low price shares from one category of participants to another. This activity requires considerable selling power, which exhausts the actual number of sellers who may agree to keep giving away their shares at the low prices, offered to them. Individuals no longer agree to sell shares and this indicates a critical point for the market: now the expected trend is for an upwards reversal.